The NAR settlement has upended the real estate industry, disrupting long-standing commission structures and leaving buyer agents scrambling for new ways to secure their income. With commissions shrinking in some markets, nearly a third of agents are eyeing a bold solution: dual licensing as both Realtors and loan originators. 

Controlling both sides of the transaction could mean bigger paychecks, but it also introduces a minefield of compliance risks, regulatory contradictions, and shifting market dynamics. As lenders and agents navigate this uncertain terrain, a key question looms: Is dual licensing the future of real estate, or a legal and financial gamble?

The Surge In Dual Licensing

Buyer agents' interest in dual licensing is reflected in a 2024 real estate agent survey conducted by Hanover Research. Thirty-two percent of agents said they are currently pursuing or plan to obtain an MLO license. Another 42% are considering it but have yet to take action. The primary motivation? Higher earning potential, cited by 55% of those planning to become dual-licensed.

Industry leaders are taking notice. Mortgage Bankers Association (MBA) President and CEO Bob Broeksmit recently spoke about the trend at the MBA National Advocacy Conference in Washington, D.C.: "One of those models could be that you, as lenders, license your loan officers as real estate agents and offer the buying agent service for less than a 3% fixed fee point," Broeksmit said.

Some lenders have already embraced the shift. Pablo Martinez, Founder and CEO of Equity Smart Home Loans, has made dual-licensing central to his business. "We’re marketing to Realtors and turning them into loan officers and vice versa," Martinez said, adding that his dual-licensed agents close, on average, three to four loans per month.

For lenders and brokers, the dual-licensing boom presents both a competitive opportunity and a compliance risk.

The Regulatory Minefield

While dual licensing has the potential to streamline transactions and boost revenue, conflicting federal regulations create major hurdles.

Garris Horn Attorney James Brody warns that a lack of regulatory clarity could lead to serious legal and financial consequences for lenders adopting the model too quickly.

32% of agents said they are currently pursuing or have plans to get a mortgage loan originator (MLO) license

Even though the Federal Housing Administration (FHA) has allowed an individual to act as both an agent and loan originator on FHA-insured transactions, the U.S. Department of Agriculture (USDA) explicitly prohibits it. "The problem is that the USDA clarified that it had been a conflict of interest and was specifically disallowing it," Brody said. "So you have some competing messages."

Beyond federal conflicts, the Loan Officer Compensation (LO Comp) rule and the Real Estate Settlement Procedures Act (RESPA) present additional risks.

Brody believes most dual-licensed agents will structure compensation to comply with LO Comp by getting paid as loan officers by the lender. However, he notes that many will still collect buyer agent commissions from the client, potentially triggering scrutiny under both LO Comp and RESPA.

FHA’s 2022 Mortgagee Letter allows double commissions with restrictions — namely that individuals with direct influence over mortgage approval (such as underwriters, appraisers, and inspectors) cannot hold dual roles.

Still, some lenders remain wary. Many mortgage companies refuse to allow real estate agents to act as MLOs on the same transaction due to compliance concerns. The CE Shop, a mortgage education provider, warns that most secondary mortgage market buyers won't purchase loans originated by someone who also served as the real estate agent on the deal.

Brody sees this regulatory ambiguity as an ongoing concern. "The CFPB has not commented on whether [dual licensing] would be considered two separate transactions or just one," he said.

Without clear federal guidance, lenders risk running afoul of compliance rules without even realizing it.

Here Come The Hybrids

Real estate and mortgage lending have always been closely connected, but some professionals are now blurring the line entirely.

"In the lending industry, we all know real estate and loan officers go hand-in-hand," said Pablo Martinez, CEO of Equity Smart Home Loans. Yet, he initially resisted hiring dual-licensed agents — until fintech changed his mind.

The rise of real estate and mortgage tech platforms — from e-signing tools like DocuSign to integrated transaction management systems — has made the two industries more intertwined than ever. Seeing this shift, Martinez launched Klovus Realty, a division that employs agents who can handle both real estate sales and mortgage origination.

"We're calling them hybrid agents," Martinez said. "They can do both real estate and [originate] loans."

Equity Smart is uniquely positioned to recruit these agents because California’s Department of Real Estate (DRE) is the only state agency that requires MLOs to also be licensed as real estate agents. That means agents licensed through the DRE automatically qualify for dual-licensing.

"We're marketing to Realtors and turning them into loan officers, and vice versa," Martinez said. "If you got your license through the Department of Real Estate, your NMLS, and your MLO [endorsement], then you automatically have the ability to do real estate when you join us."

A real estate professional anonymously posts to the NEW Loan Officers Facebook group, asking whether they can get their MLO license renewed to avoid "leaving money on the table," shortly after the NAR lawsuit settled in March 2024

This dual-income model is attracting interest. Martinez said many agents have already approached his firm to secure dual licensing, hoping to stand out in a shifting market.

"They're making double commission, so they don't have to refer out their deals," he added.

In states like California, where FHA rules allow agents to collect both real estate and MLO commissions, the model has taken off. But legal contradictions remain — and some lenders fear regulatory backlash.

Compliance Contradictions

While dual-licensed agents see an opportunity to maximize earnings, compliance experts see trouble ahead.

At the heart of the issue is a tangled web of contradicting regulations.

The Consumer Financial Protection Bureau’s (CFPB) Loan Officer Compensation (LO Comp) rule strictly prohibits MLOs from receiving payment from both the lender and the borrower on the same transaction. But the Real Estate Settlement Procedures Act (RESPA) also restricts financial incentives that could be perceived as steering business.

"Under the [CFPB] LO Comp rule, you're not allowed to be compensated by the borrower and the lender," said Garris Horn Attorney James Brody. "It’s one or the other."

But this is where things get murky.

While FHA clarified in 2022 that an individual can receive both real estate and MLO commissions in an FHA-backed transaction, that rule doesn’t apply across the board.

"The problem is that the USDA clarified that it had been a conflict of interest and was specifically disallowing it," Brody said. "So you have some competing messages."

To make things even more complicated, the CFPB has not stated whether dual-licensed agents working on the same deal are technically engaging in one transaction or two. That distinction could determine whether they violate LO Comp rules.

"The CFPB has stated that if you’re an individual loan officer, all payments to you are considered compensation for LO originated activities, regardless of how those charges are labeled," Brody explained.

This uncertainty makes lenders nervous.

Many mortgage companies have strict policies against allowing agents to act as MLOs on the same transaction. Some industry experts warn that secondary mortgage market buyers won’t purchase loans where an agent plays both roles.

"Most mortgage buyers on the secondary market will not purchase closed loans of borrowers who were represented by someone acting as the real estate agent and Mortgage Loan Officer on the same transaction," according to mortgage educators at the CE Shop.

Despite these concerns, the demand for dual-licensing is growing — and some lenders see the potential for reform.

"I don't think that the regulators would say that things can't be improved," Brody said. "But there’s a lot of the problems that we’re looking at."

For now, the dual-capacity model remains in legal limbo — and lenders, agents, and regulators are still figuring out where the lines should be drawn.

The Crush Of Competition 

The rise of dual-licensed agents is shaking up the mortgage industry, forcing traditional lenders to compete with new, high-paying rivals. Lenders that offer agents the ability to earn twice the commission on a single transaction are disrupting referral-based business models — and firms like U.S. Mortgage Corp. are feeling the pressure.

"If my loan officer has a relationship with a Realtor for many years and we don’t offer this dual compensation opportunity, that referral source… may seek to become a loan officer for a competitive mortgage company," said Steven A. Milner, CEO of U.S. Mortgage Corporation.

With dual-licensing gaining traction, mortgage brokers, bankers, depository institutions, and credit unions are aggressively recruiting agents who want to expand their income streams. But Milner warns that banks and credit unions hold an unfair advantage in this race.

Under the SAFE Act, depository institutions only need to federally register their loan originators and pass the NMLS test — without the extensive pre-licensing education required for non-bank lenders.

"Depository institutions are recruiting Realtors to be loan officers. They do not have to take any pre-licensing education. They do not have to take a test. They just have to send a registration form into the banking department," Milner said. "And I don’t think that’s fair. I am personally going to be lobbying against that."

To stay competitive, Milner encourages lenders to recruit and train their own dual-licensed agents — before they’re lured away by better offers.

"By encouraging a buyer’s agent to become dual-licensed, [they will] be motivated to introduce other circles of influence… such as their attorney or their accountant," he said. "If they become a loan officer, they can now create referral relationships of their own."

Power Shift

The balance of power in real estate is shifting, and dual-licensed agents are at the center of it.

"If anyone invented the wheel, I would be one of those people," said William Lane, a dual-licensed agent for 16 years. When he started, there were just 26 dual-licensed agents in his market. Now, he estimates, there are thousands.

Lane believes that as interest rates drop and inventory increases, buyer agents will regain leverage — and commission structures will adjust accordingly.

"I think we’ll see some equality as to how the commission structure is going to play out," he said.

Lane, a top-producing dual-licensed agent at U.S. Mortgage Corporation, closes between 85 and 100 loans annually, totaling $15 million in volume. Yet, even with his success, he admits that being an MLO is far more complex than selling real estate.

"With ever-changing programs, rates, and guidelines, being an originator is a lot harder than being a Realtor," he said.

Because of the regulatory and operational challenges of holding both roles, Lane only works with lenders that have strict compliance measures in place.

"I don't lift a finger towards compliance. I do what I'm told, so to speak," Lane said. "If I had to manage all of that stuff myself, I would not be responsible for 100 transactions annually. I wouldn't have the time to do it."

Still, he predicts that as the market shifts in favor of buyers, sellers won’t be able to dictate terms as easily.

"Right now, for a seller agent, it's like shooting fish in a barrel," he said. "But times are going to change… and the thought of not offering buyer agents any commission at all will go out the window because you're going to need them."

For lenders and agents alike, the big question remains: Is dual-licensing a long-term solution or a temporary response to market uncertainty?

As Equity Smart CEO Pablo Martinez put it, agents will go where the money is.

"If agents can't work at dual capacity for greater pay, then they’re going to go somewhere else where they can."

The NAR settlement has forced mortgage professionals to rethink their relationships with real estate agents. Dual licensing offers a path to greater control and higher earnings, but it also comes with compliance risks and regulatory uncertainty. Navigating LO Comp, RESPA, and other legal hurdles will require careful planning and strict compliance. For those who can adapt, though, dual licensing is more than a trend — it could be a powerful advantage in a shifting market.